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I was in the Tabula Rasa beta. The difference in the game between release and a month prior to release was drastic. In less than two months they stripped out all of the dynamic lighting, completely overhauled the gameplay and basically made a master-piece sci-fi MMO into a strange shooter-esque World of Warcraft clone. The differences are not disimilar to what's being pointed out here. Players with high end machines (like mine) flipped the ***** out as moody, atmospheric, and beautiful scenery was rapidly replaced with bright shiny and colorful crap.

In the case of Tabula Rasa (and Richard Garriot was absolutely right to sue NCSoft for that travesty) it was the publisher making demands that caused the changes that eventually killed the game.

Why they happened here, I can't say, but to call them liars for making the game easier to run is a bit strong. This happens in the development cycle of a game. It happens for many good reasons and many bad reasons. With that kind of lighting and fog it's likely they had a hard time keeping 60 FPS in high action sequences. Two or three monsters, not a problem, 20-30, there's no way you can render that many skeletons and keep your framerate.

Lay off, I suspect that was actual gameplay footage, especially when you notice how slowly the person is turning in the demo. That's a side effect of the frame rate loss from having all of those effects turned on. And no, you don't let players have the option to add them back, when you pull out that code to make the game faster, it's not a switch you can flip to bring it back.

I can you what happened, they worked out that the Xbox and PS3 couldn't handle the fog and lighting so just striped it out. Alternatively, they lost the code when their server fried and they had to remake everything in 6 months and hence the crappiness.

Hmmm... I have some theory:
At the beginning Gearbox outsourced creating game to company X. Company X prepared "Demo", but informed Gearbox that game budget is too low and they need more money. Gearbox fired them and takes cheaper company Y to prepare game... But company X had all rights to assets that they created, so Gearbox/Y cannot use it... So company Y prepared it again in much poorer quality....